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Before You Invest
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The best investment you can ever make is an investment in yourself. Earnings power from your own skills and productiveness to society are your best means for getting a head start at building or storing wealth and putting capital to work.
When low risk investments are yielding 3% and you are able to earn $30,000 per year in wages from your profession or job, that is equivilent to having $1,000,000 invested in such low risk investments and earning 3%.
Not always will you be able to be employed for various reasons. When you cannot work and bring home pay, it's like you went from being worth $1,000,000 in low risk investments to having $0 invested. When this happens, it's critical to have at least 3 months of savings or preferably, 6 months just to fall back on in the event of unemployment.
It will not be until you can safely have 3 to 6 months of savings, little to no debt and willing to take on a degree of risk for a higher rate of return should you invest.
Investing wisely should be done in a low cost manner.(i.e. no mutual funds or expensive brokers) It should be done in an intelligent manner, meaning knowing what you are doing.
Leverage should be avoided as much as possible when investing. Investing with leverage can be a whole lot of fun on the way up, but can be life changing on the way down and therefore making the risk not worth it.
Just think how many families are struggling today because they bought a house will little to no down payment or how many companies now face bankrupcy because they can no longer service their debt service payments let alone make a profit in todays tough times.
What expectations should you have? First and foremost, your goal should be to beat the rate of inflation and to do so while aiming to take the last amount of risk.
Being a Value Investor who buys income producting assets when they are selling at deep discounts to their fair present value is one way to increase your chances of being a successful investor.
Explore my site, read more lessons and take a look at some of my investment ideas. Good luck!
Disclosure: This is not a means to solicit any of the securities mentioned nor does it recommend it for any person before they speak with a licensed professional investment advisor for their own suitability. Investing in Equities bears risk of capital loss. This is strictly the opinion of Jason Tillberg, President and founder of Tillberg Capital Management, Inc. and shall not be held responsible for investment loss from this writeup.
